Private Equity Fund Raising Deals

Private equity fund raising can be difficult (but essential) part of starting up a new investment company. To find LPs, and reach your goal, you should leverage your network. This requires deliberate relationship-management using the right methods and tools.

LPs are investors who invest capital to a private equity fund. They are typically large institutional investors, like pension funds, endowments or mutual funds. Other times they are high-net-worth people or family offices that are looking for a return on their investment in an equity fund that is private. Additionally, some LPs are funds-of-funds that have the resources to invest in a variety of private equity funds. They can help you build a diverse portfolio of alternative investments.

You must meet a set of requirements to qualify as a LP. Generally speaking, LPs look for an investment strategy that is in line with yours, a track-record of a similar strategy and a commitment to invest. They will also expect you to be knowledgeable about the operation of your fund and be able to explain why it’s worth investing.

To maximize the benefits of your LP relationships It’s a good idea to get your legal team to draft the offering memorandum, partnership terms and subscription agreement before you begin actively seeking out potential LPs. It’s also a good idea to evaluate your internal capacities in investor relations and to consider hiring a placement agent.